Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/273674 
Year of Publication: 
2023
Series/Report no.: 
GLO Discussion Paper No. 1316
Publisher: 
Global Labor Organization (GLO), Essen
Abstract: 
The reciprocal relationship between psychiatric and substance use disorders is well-known, yet it remains largely unknown whether mental health morbidity causally leads to addictive behaviours. This paper utilises a fixed effects instrumental variables model, which is identified by time-varying sources of plausibly exogenous variations in mental health, and a nationally representative panel dataset from Australia to present robust evidence on the causal impact of mental distress on cigarette smoking and alcohol drinking behaviours. We find that mental distress significantly increases the prevalence and intensity of either cigarette or alcohol consumption. Further analysis reveals that mental distress also substantially increases household monetary expenditures on either tobacco or alcohol. The impact is greater for lower educated individuals or children of smokers, and is slightly higher for males. Our findings highlight the importance of mental health screening and treatment programs, especially among lower educated individuals or children of smokers, to assist in the prevention of addictive activities.
Subjects: 
Mental Health
Depression
Smoking
Drinking
Alcohol Addiction
Instrumental Variables
JEL: 
C26
I10
I12
I14
Document Type: 
Working Paper

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